German ILF wins feasibility contract for IP pipeline

Oct 26, 2010 12:00 AM

The Pakistan government has awarded a $ 55 mm feasibility study contract to ILF, of Germany, for the $ 2.5 bn Iran-Pakistan (IP) gas pipeline project with the condition that the consultant "will complete its job in only 12 months", against original plan of 18 months.

The consultant will complete feasibility study on banking proposition to raise funds for the project, environmental aspect, pipeline route and land acquisition for procurement of land for the project within stipulated timeframe. The consultant will complete the feasibility study for the project in two phases and likewise get the payment from the government of Pakistan.

Sources said that Pakistan had a plan to give the consultant one-and-a-half years for completing the feasibility study for IP gas line project, but now, with rising energy shortfall in demand and supply and already faced with a delay of around one year, the government cut down feasibility study time from 18 to 12 months.

Pakistani officials informed the visiting ILF team that all issues with the Iranian authorities have been settled, including Gas Sale and Purchase Agreement (GSPA) and third-party certification for uninterrupted supply of gas from the source field to Pakistan for 30 years, and now it was the time to act swiftly and complete the gas line as early as possible to make practically possible to import the much-needed gas from Iran.

Pakistan and Iran had taken years to reach an agreement for finalizing thorny issues of IP such as gas pricing, source field dedication to make sure that Pakistan gets required gas supply for total project lifetime of 30 years. Other than bilateral issues with Iran for this key project, Pakistan had resisted pressure from various international players like the USA to make it possible that Pakistan does not miss the opportunity to import gas from the nearest external source. "Now we are comfortable that after continuous effort for years, IP gas line is going to enter practical phase to help Pakistan get gas from Iran to meet its rising shortfall in demand and supply," an official of Petroleum Ministry said.

He confirmed that the Petroleum Ministry had successfully concluded deliberations with ILF, Germany to award feasibility study during last two days, and the consultant had agreed to complete the work in revised timeframe to help Pakistan enter construction phase in 2012.

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